The dataset is about prosper loans. It contains records for number of person to person loans. It would be interesting to check who borrow money, what amount, what rate and how rate depends on other attributes.

Exploration of the data

Add ListingCategory factor variable that meets int ListingCategory..numeric. column

Univariate Plots Section

Check distributions for some basic attributes.

##  [1] "ListingKey"                         
##  [2] "ListingNumber"                      
##  [3] "ListingCreationDate"                
##  [4] "CreditGrade"                        
##  [5] "Term"                               
##  [6] "LoanStatus"                         
##  [7] "ClosedDate"                         
##  [8] "BorrowerAPR"                        
##  [9] "BorrowerRate"                       
## [10] "LenderYield"                        
## [11] "EstimatedEffectiveYield"            
## [12] "EstimatedLoss"                      
## [13] "EstimatedReturn"                    
## [14] "ProsperRating..numeric."            
## [15] "ProsperRating..Alpha."              
## [16] "ProsperScore"                       
## [17] "ListingCategory..numeric."          
## [18] "BorrowerState"                      
## [19] "Occupation"                         
## [20] "EmploymentStatus"                   
## [21] "EmploymentStatusDuration"           
## [22] "IsBorrowerHomeowner"                
## [23] "CurrentlyInGroup"                   
## [24] "GroupKey"                           
## [25] "DateCreditPulled"                   
## [26] "CreditScoreRangeLower"              
## [27] "CreditScoreRangeUpper"              
## [28] "FirstRecordedCreditLine"            
## [29] "CurrentCreditLines"                 
## [30] "OpenCreditLines"                    
## [31] "TotalCreditLinespast7years"         
## [32] "OpenRevolvingAccounts"              
## [33] "OpenRevolvingMonthlyPayment"        
## [34] "InquiriesLast6Months"               
## [35] "TotalInquiries"                     
## [36] "CurrentDelinquencies"               
## [37] "AmountDelinquent"                   
## [38] "DelinquenciesLast7Years"            
## [39] "PublicRecordsLast10Years"           
## [40] "PublicRecordsLast12Months"          
## [41] "RevolvingCreditBalance"             
## [42] "BankcardUtilization"                
## [43] "AvailableBankcardCredit"            
## [44] "TotalTrades"                        
## [45] "TradesNeverDelinquent..percentage." 
## [46] "TradesOpenedLast6Months"            
## [47] "DebtToIncomeRatio"                  
## [48] "IncomeRange"                        
## [49] "IncomeVerifiable"                   
## [50] "StatedMonthlyIncome"                
## [51] "LoanKey"                            
## [52] "TotalProsperLoans"                  
## [53] "TotalProsperPaymentsBilled"         
## [54] "OnTimeProsperPayments"              
## [55] "ProsperPaymentsLessThanOneMonthLate"
## [56] "ProsperPaymentsOneMonthPlusLate"    
## [57] "ProsperPrincipalBorrowed"           
## [58] "ProsperPrincipalOutstanding"        
## [59] "ScorexChangeAtTimeOfListing"        
## [60] "LoanCurrentDaysDelinquent"          
## [61] "LoanFirstDefaultedCycleNumber"      
## [62] "LoanMonthsSinceOrigination"         
## [63] "LoanNumber"                         
## [64] "LoanOriginalAmount"                 
## [65] "LoanOriginationDate"                
## [66] "LoanOriginationQuarter"             
## [67] "MemberKey"                          
## [68] "MonthlyLoanPayment"                 
## [69] "LP_CustomerPayments"                
## [70] "LP_CustomerPrincipalPayments"       
## [71] "LP_InterestandFees"                 
## [72] "LP_ServiceFees"                     
## [73] "LP_CollectionFees"                  
## [74] "LP_GrossPrincipalLoss"              
## [75] "LP_NetPrincipalLoss"                
## [76] "LP_NonPrincipalRecoverypayments"    
## [77] "PercentFunded"                      
## [78] "Recommendations"                    
## [79] "InvestmentFromFriendsCount"         
## [80] "InvestmentFromFriendsAmount"        
## [81] "Investors"                          
## [82] "ListingCategory"
##                    ListingKey     ListingNumber    
##  17A93590655669644DB4C06:     6   Min.   :      4  
##  349D3587495831350F0F648:     4   1st Qu.: 400919  
##  47C1359638497431975670B:     4   Median : 600554  
##  8474358854651984137201C:     4   Mean   : 627886  
##  DE8535960513435199406CE:     4   3rd Qu.: 892634  
##  04C13599434217079754AEE:     3   Max.   :1255725  
##  (Other)                :113912                    
##                     ListingCreationDate  CreditGrade         Term      
##  2013-10-02 17:20:16.550000000:     6          :84984   Min.   :12.00  
##  2013-08-28 20:31:41.107000000:     4   C      : 5649   1st Qu.:36.00  
##  2013-09-08 09:27:44.853000000:     4   D      : 5153   Median :36.00  
##  2013-12-06 05:43:13.830000000:     4   B      : 4389   Mean   :40.83  
##  2013-12-06 11:44:58.283000000:     4   AA     : 3509   3rd Qu.:36.00  
##  2013-08-21 07:25:22.360000000:     3   HR     : 3508   Max.   :60.00  
##  (Other)                      :113912   (Other): 6745                  
##                  LoanStatus                  ClosedDate   
##  Current              :56576                      :58848  
##  Completed            :38074   2014-03-04 00:00:00:  105  
##  Chargedoff           :11992   2014-02-19 00:00:00:  100  
##  Defaulted            : 5018   2014-02-11 00:00:00:   92  
##  Past Due (1-15 days) :  806   2012-10-30 00:00:00:   81  
##  Past Due (31-60 days):  363   2013-02-26 00:00:00:   78  
##  (Other)              : 1108   (Other)            :54633  
##   BorrowerAPR       BorrowerRate     LenderYield     
##  Min.   :0.00653   Min.   :0.0000   Min.   :-0.0100  
##  1st Qu.:0.15629   1st Qu.:0.1340   1st Qu.: 0.1242  
##  Median :0.20976   Median :0.1840   Median : 0.1730  
##  Mean   :0.21883   Mean   :0.1928   Mean   : 0.1827  
##  3rd Qu.:0.28381   3rd Qu.:0.2500   3rd Qu.: 0.2400  
##  Max.   :0.51229   Max.   :0.4975   Max.   : 0.4925  
##  NA's   :25                                          
##  EstimatedEffectiveYield EstimatedLoss   EstimatedReturn 
##  Min.   :-0.183          Min.   :0.005   Min.   :-0.183  
##  1st Qu.: 0.116          1st Qu.:0.042   1st Qu.: 0.074  
##  Median : 0.162          Median :0.072   Median : 0.092  
##  Mean   : 0.169          Mean   :0.080   Mean   : 0.096  
##  3rd Qu.: 0.224          3rd Qu.:0.112   3rd Qu.: 0.117  
##  Max.   : 0.320          Max.   :0.366   Max.   : 0.284  
##  NA's   :29084           NA's   :29084   NA's   :29084   
##  ProsperRating..numeric. ProsperRating..Alpha.  ProsperScore  
##  Min.   :1.000                  :29084         Min.   : 1.00  
##  1st Qu.:3.000           C      :18345         1st Qu.: 4.00  
##  Median :4.000           B      :15581         Median : 6.00  
##  Mean   :4.072           A      :14551         Mean   : 5.95  
##  3rd Qu.:5.000           D      :14274         3rd Qu.: 8.00  
##  Max.   :7.000           E      : 9795         Max.   :11.00  
##  NA's   :29084           (Other):12307         NA's   :29084  
##  ListingCategory..numeric. BorrowerState  
##  Min.   : 0.000            CA     :14717  
##  1st Qu.: 1.000            TX     : 6842  
##  Median : 1.000            NY     : 6729  
##  Mean   : 2.774            FL     : 6720  
##  3rd Qu.: 3.000            IL     : 5921  
##  Max.   :20.000                   : 5515  
##                            (Other):67493  
##                     Occupation         EmploymentStatus
##  Other                   :28617   Employed     :67322  
##  Professional            :13628   Full-time    :26355  
##  Computer Programmer     : 4478   Self-employed: 6134  
##  Executive               : 4311   Not available: 5347  
##  Teacher                 : 3759   Other        : 3806  
##  Administrative Assistant: 3688                : 2255  
##  (Other)                 :55456   (Other)      : 2718  
##  EmploymentStatusDuration IsBorrowerHomeowner CurrentlyInGroup
##  Min.   :  0.00           False:56459         False:101218    
##  1st Qu.: 26.00           True :57478         True : 12719    
##  Median : 67.00                                               
##  Mean   : 96.07                                               
##  3rd Qu.:137.00                                               
##  Max.   :755.00                                               
##  NA's   :7625                                                 
##                     GroupKey                 DateCreditPulled 
##                         :100596   2013-12-23 09:38:12:     6  
##  783C3371218786870A73D20:  1140   2013-11-21 09:09:41:     4  
##  3D4D3366260257624AB272D:   916   2013-12-06 05:43:16:     4  
##  6A3B336601725506917317E:   698   2014-01-14 20:17:49:     4  
##  FEF83377364176536637E50:   611   2014-02-09 12:14:41:     4  
##  C9643379247860156A00EC0:   342   2013-09-27 22:04:54:     3  
##  (Other)                :  9634   (Other)            :113912  
##  CreditScoreRangeLower CreditScoreRangeUpper
##  Min.   :  0.0         Min.   : 19.0        
##  1st Qu.:660.0         1st Qu.:679.0        
##  Median :680.0         Median :699.0        
##  Mean   :685.6         Mean   :704.6        
##  3rd Qu.:720.0         3rd Qu.:739.0        
##  Max.   :880.0         Max.   :899.0        
##  NA's   :591           NA's   :591          
##         FirstRecordedCreditLine CurrentCreditLines OpenCreditLines
##                     :   697     Min.   : 0.00      Min.   : 0.00  
##  1993-12-01 00:00:00:   185     1st Qu.: 7.00      1st Qu.: 6.00  
##  1994-11-01 00:00:00:   178     Median :10.00      Median : 9.00  
##  1995-11-01 00:00:00:   168     Mean   :10.32      Mean   : 9.26  
##  1990-04-01 00:00:00:   161     3rd Qu.:13.00      3rd Qu.:12.00  
##  1995-03-01 00:00:00:   159     Max.   :59.00      Max.   :54.00  
##  (Other)            :112389     NA's   :7604       NA's   :7604   
##  TotalCreditLinespast7years OpenRevolvingAccounts
##  Min.   :  2.00             Min.   : 0.00        
##  1st Qu.: 17.00             1st Qu.: 4.00        
##  Median : 25.00             Median : 6.00        
##  Mean   : 26.75             Mean   : 6.97        
##  3rd Qu.: 35.00             3rd Qu.: 9.00        
##  Max.   :136.00             Max.   :51.00        
##  NA's   :697                                     
##  OpenRevolvingMonthlyPayment InquiriesLast6Months TotalInquiries   
##  Min.   :    0.0             Min.   :  0.000      Min.   :  0.000  
##  1st Qu.:  114.0             1st Qu.:  0.000      1st Qu.:  2.000  
##  Median :  271.0             Median :  1.000      Median :  4.000  
##  Mean   :  398.3             Mean   :  1.435      Mean   :  5.584  
##  3rd Qu.:  525.0             3rd Qu.:  2.000      3rd Qu.:  7.000  
##  Max.   :14985.0             Max.   :105.000      Max.   :379.000  
##                              NA's   :697          NA's   :1159     
##  CurrentDelinquencies AmountDelinquent   DelinquenciesLast7Years
##  Min.   : 0.0000      Min.   :     0.0   Min.   : 0.000         
##  1st Qu.: 0.0000      1st Qu.:     0.0   1st Qu.: 0.000         
##  Median : 0.0000      Median :     0.0   Median : 0.000         
##  Mean   : 0.5921      Mean   :   984.5   Mean   : 4.155         
##  3rd Qu.: 0.0000      3rd Qu.:     0.0   3rd Qu.: 3.000         
##  Max.   :83.0000      Max.   :463881.0   Max.   :99.000         
##  NA's   :697          NA's   :7622       NA's   :990            
##  PublicRecordsLast10Years PublicRecordsLast12Months RevolvingCreditBalance
##  Min.   : 0.0000          Min.   : 0.000            Min.   :      0       
##  1st Qu.: 0.0000          1st Qu.: 0.000            1st Qu.:   3121       
##  Median : 0.0000          Median : 0.000            Median :   8549       
##  Mean   : 0.3126          Mean   : 0.015            Mean   :  17599       
##  3rd Qu.: 0.0000          3rd Qu.: 0.000            3rd Qu.:  19521       
##  Max.   :38.0000          Max.   :20.000            Max.   :1435667       
##  NA's   :697              NA's   :7604              NA's   :7604          
##  BankcardUtilization AvailableBankcardCredit  TotalTrades    
##  Min.   :0.000       Min.   :     0          Min.   :  0.00  
##  1st Qu.:0.310       1st Qu.:   880          1st Qu.: 15.00  
##  Median :0.600       Median :  4100          Median : 22.00  
##  Mean   :0.561       Mean   : 11210          Mean   : 23.23  
##  3rd Qu.:0.840       3rd Qu.: 13180          3rd Qu.: 30.00  
##  Max.   :5.950       Max.   :646285          Max.   :126.00  
##  NA's   :7604        NA's   :7544            NA's   :7544    
##  TradesNeverDelinquent..percentage. TradesOpenedLast6Months
##  Min.   :0.000                      Min.   : 0.000         
##  1st Qu.:0.820                      1st Qu.: 0.000         
##  Median :0.940                      Median : 0.000         
##  Mean   :0.886                      Mean   : 0.802         
##  3rd Qu.:1.000                      3rd Qu.: 1.000         
##  Max.   :1.000                      Max.   :20.000         
##  NA's   :7544                       NA's   :7544           
##  DebtToIncomeRatio         IncomeRange    IncomeVerifiable
##  Min.   : 0.000    $25,000-49,999:32192   False:  8669    
##  1st Qu.: 0.140    $50,000-74,999:31050   True :105268    
##  Median : 0.220    $100,000+     :17337                   
##  Mean   : 0.276    $75,000-99,999:16916                   
##  3rd Qu.: 0.320    Not displayed : 7741                   
##  Max.   :10.010    $1-24,999     : 7274                   
##  NA's   :8554      (Other)       : 1427                   
##  StatedMonthlyIncome                    LoanKey       TotalProsperLoans
##  Min.   :      0     CB1B37030986463208432A1:     6   Min.   :0.00     
##  1st Qu.:   3200     2DEE3698211017519D7333F:     4   1st Qu.:1.00     
##  Median :   4667     9F4B37043517554537C364C:     4   Median :1.00     
##  Mean   :   5608     D895370150591392337ED6D:     4   Mean   :1.42     
##  3rd Qu.:   6825     E6FB37073953690388BC56D:     4   3rd Qu.:2.00     
##  Max.   :1750003     0D8F37036734373301ED419:     3   Max.   :8.00     
##                      (Other)                :113912   NA's   :91852    
##  TotalProsperPaymentsBilled OnTimeProsperPayments
##  Min.   :  0.00             Min.   :  0.00       
##  1st Qu.:  9.00             1st Qu.:  9.00       
##  Median : 16.00             Median : 15.00       
##  Mean   : 22.93             Mean   : 22.27       
##  3rd Qu.: 33.00             3rd Qu.: 32.00       
##  Max.   :141.00             Max.   :141.00       
##  NA's   :91852              NA's   :91852        
##  ProsperPaymentsLessThanOneMonthLate ProsperPaymentsOneMonthPlusLate
##  Min.   : 0.00                       Min.   : 0.00                  
##  1st Qu.: 0.00                       1st Qu.: 0.00                  
##  Median : 0.00                       Median : 0.00                  
##  Mean   : 0.61                       Mean   : 0.05                  
##  3rd Qu.: 0.00                       3rd Qu.: 0.00                  
##  Max.   :42.00                       Max.   :21.00                  
##  NA's   :91852                       NA's   :91852                  
##  ProsperPrincipalBorrowed ProsperPrincipalOutstanding
##  Min.   :    0            Min.   :    0              
##  1st Qu.: 3500            1st Qu.:    0              
##  Median : 6000            Median : 1627              
##  Mean   : 8472            Mean   : 2930              
##  3rd Qu.:11000            3rd Qu.: 4127              
##  Max.   :72499            Max.   :23451              
##  NA's   :91852            NA's   :91852              
##  ScorexChangeAtTimeOfListing LoanCurrentDaysDelinquent
##  Min.   :-209.00             Min.   :   0.0           
##  1st Qu.: -35.00             1st Qu.:   0.0           
##  Median :  -3.00             Median :   0.0           
##  Mean   :  -3.22             Mean   : 152.8           
##  3rd Qu.:  25.00             3rd Qu.:   0.0           
##  Max.   : 286.00             Max.   :2704.0           
##  NA's   :95009                                        
##  LoanFirstDefaultedCycleNumber LoanMonthsSinceOrigination   LoanNumber    
##  Min.   : 0.00                 Min.   :  0.0              Min.   :     1  
##  1st Qu.: 9.00                 1st Qu.:  6.0              1st Qu.: 37332  
##  Median :14.00                 Median : 21.0              Median : 68599  
##  Mean   :16.27                 Mean   : 31.9              Mean   : 69444  
##  3rd Qu.:22.00                 3rd Qu.: 65.0              3rd Qu.:101901  
##  Max.   :44.00                 Max.   :100.0              Max.   :136486  
##  NA's   :96985                                                            
##  LoanOriginalAmount          LoanOriginationDate LoanOriginationQuarter
##  Min.   : 1000      2014-01-22 00:00:00:   491   Q4 2013:14450         
##  1st Qu.: 4000      2013-11-13 00:00:00:   490   Q1 2014:12172         
##  Median : 6500      2014-02-19 00:00:00:   439   Q3 2013: 9180         
##  Mean   : 8337      2013-10-16 00:00:00:   434   Q2 2013: 7099         
##  3rd Qu.:12000      2014-01-28 00:00:00:   339   Q3 2012: 5632         
##  Max.   :35000      2013-09-24 00:00:00:   316   Q2 2012: 5061         
##                     (Other)            :111428   (Other):60343         
##                    MemberKey      MonthlyLoanPayment LP_CustomerPayments
##  63CA34120866140639431C9:     9   Min.   :   0.0     Min.   :   -2.35   
##  16083364744933457E57FB9:     8   1st Qu.: 131.6     1st Qu.: 1005.76   
##  3A2F3380477699707C81385:     8   Median : 217.7     Median : 2583.83   
##  4D9C3403302047712AD0CDD:     8   Mean   : 272.5     Mean   : 4183.08   
##  739C338135235294782AE75:     8   3rd Qu.: 371.6     3rd Qu.: 5548.40   
##  7E1733653050264822FAA3D:     8   Max.   :2251.5     Max.   :40702.39   
##  (Other)                :113888                                         
##  LP_CustomerPrincipalPayments LP_InterestandFees LP_ServiceFees   
##  Min.   :    0.0              Min.   :   -2.35   Min.   :-664.87  
##  1st Qu.:  500.9              1st Qu.:  274.87   1st Qu.: -73.18  
##  Median : 1587.5              Median :  700.84   Median : -34.44  
##  Mean   : 3105.5              Mean   : 1077.54   Mean   : -54.73  
##  3rd Qu.: 4000.0              3rd Qu.: 1458.54   3rd Qu.: -13.92  
##  Max.   :35000.0              Max.   :15617.03   Max.   :  32.06  
##                                                                   
##  LP_CollectionFees  LP_GrossPrincipalLoss LP_NetPrincipalLoss
##  Min.   :-9274.75   Min.   :  -94.2       Min.   : -954.5    
##  1st Qu.:    0.00   1st Qu.:    0.0       1st Qu.:    0.0    
##  Median :    0.00   Median :    0.0       Median :    0.0    
##  Mean   :  -14.24   Mean   :  700.4       Mean   :  681.4    
##  3rd Qu.:    0.00   3rd Qu.:    0.0       3rd Qu.:    0.0    
##  Max.   :    0.00   Max.   :25000.0       Max.   :25000.0    
##                                                              
##  LP_NonPrincipalRecoverypayments PercentFunded    Recommendations   
##  Min.   :    0.00                Min.   :0.7000   Min.   : 0.00000  
##  1st Qu.:    0.00                1st Qu.:1.0000   1st Qu.: 0.00000  
##  Median :    0.00                Median :1.0000   Median : 0.00000  
##  Mean   :   25.14                Mean   :0.9986   Mean   : 0.04803  
##  3rd Qu.:    0.00                3rd Qu.:1.0000   3rd Qu.: 0.00000  
##  Max.   :21117.90                Max.   :1.0125   Max.   :39.00000  
##                                                                     
##  InvestmentFromFriendsCount InvestmentFromFriendsAmount   Investors      
##  Min.   : 0.00000           Min.   :    0.00            Min.   :   1.00  
##  1st Qu.: 0.00000           1st Qu.:    0.00            1st Qu.:   2.00  
##  Median : 0.00000           Median :    0.00            Median :  44.00  
##  Mean   : 0.02346           Mean   :   16.55            Mean   :  80.48  
##  3rd Qu.: 0.00000           3rd Qu.:    0.00            3rd Qu.: 115.00  
##  Max.   :33.00000           Max.   :25000.00            Max.   :1189.00  
##                                                                          
##            ListingCategory 
##  Debt Consolidation:58308  
##  Not Available     :16965  
##  Other             :10494  
##  Home Improvement  : 7433  
##  Business          : 7189  
##  Auto              : 2572  
##  (Other)           :10976

Unfortunately I was unable to run gpairs on my laptop. It worked too long anf inally hung each time. I did subsetting of several columns and run ggpairs against narrowed dataset. Finally I skip it from this report due its large size and less informativity.

Let’s start with CreditGrade

Urm.. Most of records without CreditGrade? It looks like it is due ‘Applicable for listings pre-2009 period and will only be populated for those listings.’ Try without NA data

Ok. Further… Term in months

It looks like there are 3 standard terms. Check terms in years

As it could be expected - 1, 3, and 5 years.

Categories of the listing: 0 - Not Available, 1 - Debt Consolidation, 2 - Home Improvement, 3 - Business, 4 - Personal Loan, 5 - Student Use, 6 - Auto, 7- Other, 8 - Baby&Adoption, 9 - Boat, 10 - Cosmetic Procedure, 11 - Engagement Ring, 12 - Green Loans, 13 - Household Expenses, 14 - Large Purchases, 15 - Medical/Dental, 16 - Motorcycle, 17 - RV, 18 - Taxes, 19 - Vacation, 20 - Wedding Loans

So top-3 reasons excluding N/A are following 1. Debt Consolidation 2. Other 3. Home Improvement

Not surprisingly that most of loans are for employed and full-time employed. Lender needs to be sure that loan will be payed. Most probability of returns for people who has costant income. Such people is employed.

Explore it per possible groups. Starts with BorrowerRate per Term

Continue with BorrowerRate per IncomeRange

Check how DebtToIncomeRatio is distributed

Looks like Poisson distribution. Check how LoanOriginalAmount is distributed

Peaks on 500, 1000, 1500, 2000, amd 2500. Returning back to Listing histogram we saw that most popular categories are debt consolidation and other. People tend to borrow round amount of money like 500, 1000, 2000 etc Further check MonthlyLoanPayment

and IncomeRange

Univariate Analysis

What is the structure of your dataset?

There are more than 110 thousands observations with 81 variables.

What is/are the main feature(s) of interest in your dataset?

Most interesting features I believe are BorrowerRate and LoanOriginalAmount. I am going to explore how other attributes affect them.

What other features in the dataset do you think will help support your investigation into your feature(s) of interest?

For the first glance they are: - Term - ListingCategory - EmploymentStatus - DebtToIncomeRatio - IncomeRange

Did you create any new variables from existing variables in the dataset?

Not yet

Bivariate Plots Section

Start with checking BorrowerRate per ListingCategory

Rate differs slightly on purpose of loan. Most expensive rates for Cosmetic Procedures and Houshold Expenses. Those purposes are considere too risky and so rate is high. Cheapest loan is Personal Loan. I believe it is due lender and borrower know each other well enough to be sure in borrowers ability to return. Continue with LoanOriginalAmount per ListingCategory

Check how BorrowerRate changes with LoanOriginalAmount

Consider dataset from another point. Per EmploymentStatus groups. Start with BorrowerRate

Continue with LoanOriginalAmount

Now check BorrowerRate from DebtToIncomeRatio.

Urm… It looks like we need smoothing

Remove original mean line smoothing

Now it is obvious that rate is growing with growth of DebtToIncomeRatio.

Now check a few more dependencies to see if we can find anything interesting.

LoanOriginalAmount ~ IncomeRange

BorrowerRate ~ IncomeRange

LoanOriginalAmount ~ Term

LoanOriginalAmount grows with Term

BorrowerRate ~ Term

BorrowerRate gorws with Term from 1 till 3 years and further remains about constant

Bivariate Analysis

Talk about some of the relationships you observed in this part of the investigation. How did the feature(s) of interest vary with other features in the dataset?

As we see from picture of BorrowRate ~ DebtToIncomeRatio and BorrowRate ~ Term the rate depends at least on DebtToIncomeRatio and Term (there are possible other paramaeters affecting it). A bit unexpectedly to me that it does not depend on IncomeRange. BorrowerRate grows with Term from 1 till 3 years and further remains about constant

Multivariate Plots Section

I’m providing graph advised by tutor.

For most of groups BorrowRate grows with DebtToIncomeRatio. Point that meets 0 is higher with lower IncomeRange. It is interesting curve for Not employed group. It is not monotone. I think it is due other attributes affects much BorrowRate for this group.

Final Plots and Summary

Plot One

This plot shows dependency of rate on debt to income ratio. Indeed, people who have low debt in comparision to income are expected to return the loan most probably. On the other hand people having high debt load on their budget are close to default and so lending them money is more risky which should make the rate higher. The plot shows it. Also there is a stable part of rate curve (between abot 5 and 25 %). People with ration in that interval are considered as normal borrowers.

Plot Two

Another attribute Borrower Rate depends on is term of loan. The rate is growing from 12 to 36 month and further it is about stable up to 60 (which is max term)

Plot Three

It is like Plot One but with more details per group of Income Range. In addition to findings of Plot One there are following ideas: - People with lowest income range have higher rate - People that are not employed do not have momotone curve. It is possible due other attributes are more influencing for such group - Different groups have different max DebtToIncomeRatio. Lowest one is for Not employed people

Reflection

Data set contains many attributes. I selected BorrowerRate, DebtToIncomeRatio and LoanOriginalAmount as most interesting attributes. I had technical issues with selecting attributes. ggpair worked too mahc and hung on the whole set so I had to manually filter part of attributes. To make it propriately I had to dig into business side. I understood part of attributes from my previous experience but about half of them were not clear. During exploration some times I proved my expectations regarding dependencies, sometimes I did not. I expected that rate depends on DebtToIncomeRatio. Though I would also expect that it depends on borrower income though it seems does not. If I had more time I would improve Multivariate Plots Section and make composite attributes. It’d be interesting to check how not emplyed people are scored for loan, since they seem not have stable income and so they should be scored on differet way than usual.